To mark one year since net zero by 2050 was signed into UK law, npower Business Solutions (nBS) has launched a new report – The Future Report 2020: The Road to Net Zero – which has gathered insights from experts at the London School of Economics (LSE), Department for Business, Energy & Industrial Strategy (BEIS) and Cornwall Insight to predict the future of the energy sector out to 2050.
In the short to medium term, the experts agreed that while the immediate attention will be on the post-Covid-19 recovery – a time when ‘cash will be king’ – the focus should also be on using the green economy to stimulate this recovery, arguing that it is an opportunity for the government to use net zero by 2050 to accelerate the sustainability projects that will cement a more resilient economic future.
Longer term – net zero by 2050 is the target all the contributors were focussed on. While they agreed that it was an ambitious target, all believed that it was possible if major strategic decisions around the investment in technologies, incentives for renewables and changes to the structure of the system are taken in the next five years. CCS, hydrogen, battery storage and electric vehicles were all cited as technologies that would make the biggest impact on the UK’s decarbonisation goals.
Anthony Ainsworth, COO I&C, comments, “The next 12-24 months will be particularly crucial, as organisations focus on getting ‘back to business’ post-Covid-19. It is becoming clear that a green recovery plan – that puts net zero right at the heart of the UK’s future economic resiliency – and policy clarity are urgently needed. As we await the Energy White Paper later this year, this is an opportunity to accelerate the projects that will cement a stronger and more sustainable future.”
When it came to the role businesses will play, all agreed it would be vital – but only if sustainability moves from a functional to a strategic corporate target that is embedded in company culture, from the top of the boardroom through to all employees and the wider supply chain.
Ben Spry, head of risk management at nBS, comments, “Pre-Covid-19 we were seeing the emergence of net zero as a compelling need for all. While the immediate focus will, understandably, be on operational resiliency, there also needs to be a strong focus on sustainability, using net zero as platform to kickstart the economy. A strong policy framework and more consistent mandates on the expectations of business will also be crucial to turn net zero from ambition into reality by 2050.
“For businesses, energy efficiency, onsite generation, procuring green energy, reducing and shifting demand will all become more important, particularly as consumers become increasingly influential in calling out good and bad business practice.”
The report also looks back at nBS’ original Future Report from 2011, which modelled four energy market scenarios out to 2020 to assess whether any of the lessons learned from the past can influence the future of the sector. It concluded that the green resilience that started following the financial crash of 2008/9 – particularly in terms of incentives for renewables – should serve as a positive lesson for the future. However, some predictions – including the view that CCS would be ready for deployment – have not come to fruition, with BEIS admitting it was an area it could have approached better.
Ben Spry continues, “It was interesting to look back and, although the policy landscape hasn’t evolved as quickly as we thought, and we don’t have the market price points in order to properly incentivise investment, a lot of what we said back then is true. What is clear is that there will always be issues, events or advancements that evade prediction – things that will only seem obvious with hindsight. That’s why building greater resilience and being flexible enough to adapt are now more important than ever.”
To download a copy of the Future Report 2020, please visit www.energy-hq.co.uk/futurereport2020